Financial Highlights for Fiscal 2013 Second Quarter
(YoY growth % are on constant currency basis; please see table below for YoY growth % on actual basis)
• Revenue rose 25.8% year over year (yoy) to $45.7 million in 2Q13 versus $43.8 million in 2Q12.
• Revenue less service costs increased 12.6% yoy to $20.2 million in 2Q13; Hotels and packages contribution increased to 24.0% in 2Q13 versus 17.8% in 2Q12.
• Revenue less service costs for Hotels and packages increased by 51.3% yoy in 2Q13.
• Net revenue margin for Hotels and packages increased to 12.5% in 2Q13 versus 12.1% in 2Q12.
• Adjusted net income was $1.2 million in 2Q13 versus $1.6 million in 2Q12.
• Adjusted diluted earnings per share for 2Q13 was $0.03 versus $0.04 in 2Q12.
GURGAON, India and NEW YORK, Nov. 6, 2012 (GLOBE NEWSWIRE) -- MakeMyTrip Limited (Nasdaq:MMYT), India's leading online travel company, today announced its unaudited financial and operating results for its second fiscal quarter ended September 30, 2012.
"MakeMyTrip was faced with increasingly difficult operating conditions as the health of our domestic airline industry remain uncertain." said Deep Kalra, Chairman and CEO. "However, we are confident and optimistic of our vision and investments in changing the way Indians book their hotels and holidays in the future, as this segment of the travel market remains largely underpenetrated online today.
(in thousands except EPS) |
3 months Ended September 30, 2011 |
3 months Ended September 30, 2012 |
YoY Change |
YoY Change in Constant Currency |
Revenue |
$43,790.0 |
$45,668.8 |
4.3% |
25.8% |
Revenue Less Service Costs |
$21,333.2 |
$20,155.3 |
-5.5% |
12.6% |
Air Ticketing |
$16,638.0 |
$14,501.9 |
-12.8% |
4.8% |
Hotels & packages |
$3,784.7 |
$4,937.2 |
30.5% |
51.3% |
Other |
$910.5 |
$716.3 |
-21.3% |
-6.7% |
Results from Operating Activities |
$932.7 |
($3,023.1) |
|
|
Adjusted Operating Profit |
$2,376.3 |
$37.8 |
||
Income (Loss) for the Period |
$74.2 |
($1,227.8) |
|
|
Adjusted Net Income |
$1,571.5 |
$1,153.6 |
||
Diluted Earnings (Loss) per Share |
$0.003 |
($0.03) |
|
|
Adjusted Diluted Earnings per Share |
$0.04 |
$0.03 |
|
|
Operating Metrics |
||||
Gross Bookings |
$244,950.1 |
$261,979.9 |
7.0% |
28.1% |
Air Ticketing |
$213,709.1 |
$222,582.1 |
4.2% |
25.0% |
Hotels & packages |
$31,240.9 |
$39,397.8 |
26.1% |
49.3% |
Number of Transactions |
||||
Air Ticketing |
995.9 |
898.3 |
-9.8% |
|
Hotels & packages |
74.2 |
108.9 |
46.8% |
|
Recent Developments
Acquisition of HotelTravel.com
On November 6, 2012, MakeMyTrip has acquired complete stake in the companies in the 'Hotel Travel Group' (HT Group). HT Group has been operating the website www.hoteltravel.com (the website) for more than a decade and has its presence in Thailand, Singapore and Malaysia.
The total consideration payable to the Promoters of the HT Group by MakeMyTrip for acquiring the HT Group is USD 25 million, of which USD 15 million was paid partly in cash and partly in the form of MakeMyTrip shares in the first Closing that occurred on November 6, 2012. The balance USD 10 million is agreed to be paid in the form of MakeMyTrip shares, in 3 annual tranches through March 2016. Two of the Promoters of the HT Group will continue in employment with the HT Group in key capacities, and will be eligible for additional earn outs and incentives for the next 3 —4 years based on HT Group meeting certain revenue and EBIDTA targets. The additional earn outs can range from NIL to USD 35 million and are payable partly in cash and partly in the form of MakeMyTrip shares.
HT Group, with the brand 'Hotel Travel' and the website www.hoteltravel.com, is a well-established travel company in South East Asia, especially Thailand where it has operating history of over a decade. The Group has tie ups with approximately 80,000 hotels across the world. This acquisition of the HT Group will help MakeMyTrip to further strengthen its presence in hotel and holidays segment in India and South East Asia.
Share Repurchase
The Board of Directors of the Company at a meeting held on November 6, 2012 authorized the Company to purchase outstanding ordinary shares, par value USD 0.0005 per share, of the Company on the open market, in privately negotiated transactions or otherwise in an aggregate amount of up to USD 25 million. The timing, amount, date, price and other details relating to the repurchases will be determined based on a variety of factors, including market conditions, alternative investment opportunities and other considerations.
Appointment of Directors
The Company has appointed Mr. Rajesh Magow, Co-founder and Group Chief Financial and Operating Officer and Mr. Keyur Joshi, Co-Founder and Group Chief Commercial Officer, as directors of the company effective November 6, 2012. With their appointment, the Company has a total of 11 directors on its Board of Directors.
The following table sets forth the name, age and position of each of our directors, executive officers and significant employees as of November 6, 2012:
Name |
Age |
Position/Title |
Directors: |
|
|
Deep Kalra |
43 |
Group Chairman and Group Chief Executive Officer |
Ravi Adusumalli |
36 |
Director |
Aditya Tim Guleri |
47 |
Director |
Philip C. Wolf |
56 |
Director |
Vivek N. Gour |
49 |
Independent Director |
Frederic Lalonde |
38 |
Independent Director |
Ranodeb Roy |
44 |
Independent Director |
Gyaneshwarnath Gowrea |
46 |
Director |
Mohammad Akhtar Janally |
29 |
Director |
Keyur Joshi |
39 |
Director and Group Chief Commercial Officer |
Rajesh Magow
|
44 |
Director and Group Chief Financial and Operating Officer |
Executive Officers |
|
|
Mohit Gupta
|
39 |
Group Chief Business Officer |
Amit Somani
|
40 |
Group Chief Products Officer |
Sanket Atal |
44 |
Group Chief Technology Officer |
Fiscal 2013 Second Quarter Financial Results
Revenue. We generated revenue of $45.7 million in the quarter ended September 30, 2012, an increase of 4.3% (25.8% in constant currency) over revenue of $43.8 million in the quarter ended September 30, 2011.
Air Ticketing. Revenue from our air ticketing business decreased by 19.6% (3.2% in constant currency) to $15.3 million in the quarter ended September 30, 2012 from $19.0 million in the quarter ended September 30, 2011. Our revenue less service costs decreased by 12.8% (increased by 4.8% in constant currency) to $14.5 million in the quarter ended September 30, 2012 from $16.6 million in the quarter ended September 30, 2011. This was due to transactions decreasing 9.8% year on year as demand for domestic air travel weakened on much higher airfares due to lowered capacity in the industry. The materially higher airfares caused gross bookings to grow 4.2% (increase of 25.0% in constant currency) year on year, but growth in revenue less service costs was offset by the decline in our net revenue margin to 6.5% from 7.8% a year ago, as we strategically utilized part of the margin to sustain our market share.
Hotels and Packages. Revenue from our hotels and packages business increased by 24.3% (50.6% in constant currency) to $29.6 million in the quarter ended September 30, 2012 from $23.8 million in the quarter ended September 30, 2011. Our revenue less service costs increased by 30.5% (51.3% in constant currency) to $4.9 million in the quarter ended September 30, 2012 from $3.8 million in the quarter ended September 30, 2011. This was due to an increase in gross bookings by 26.1% (49.3% in constant currency) and an increase in net revenue margin from 12.1% in the quarter ended September 30, 2011 to 12.5% in the quarter ended September 30, 2012.
Other Revenue. Our other revenue decreased to $0.7 million in the quarter ended September 30, 2012 from $0.9 million in the quarter ended September 30, 2011, primarily due to decrease in sale of rail tickets.
Total Revenue less Service Costs. Our total revenue less service costs decreased by 5.5% (increased by 12.6% in constant currency) to $20.2 million in the quarter ended September 30, 2012 from $21.3 million in the quarter ended September 30, 2011 as a result of a 12.8% decrease (increase of 4.8% in constant currency) in our air ticketing revenue less service costs, offset by an increase of 30.5% (51.3% in constant currency) in our hotels and packages revenue less service costs.
Personnel Expenses. Personnel expenses increased to $7.5 million in the quarter ended September 30, 2012 from $6.7 million in the quarter ended September 30, 2011, mainly as a result of employee share-based compensation costs of $2.9 million in the quarter ended September 30, 2012 as against $1.4 million in quarter ended September 30, 2011. Excluding employee share-based compensation costs, personnel expenses as a percentage of net revenue decreased by 1.7 percentage points year over year and increased by 2.7 percentage points over the previous quarter.
Other Operating Expenses. Other operating expenses increased by 14.3% to $14.9 million in the quarter ended September 30, 2012 from $13.0 million in the quarter ended September 30, 2011, primarily as a result of an increase in outsourcing fees and advertisement expenses in line with the growth in our business. Other operating expenses include merger and acquisitions related expenses of $0.2 million in the quarter ended September 30, 2012 as against $0.05 million in quarter ended September 30, 2011. Merger and acquisitions related expenses include professional fees and certain other expenses associated with acquisitions and certain extraordinary transactions, whether or not consummated.
Results from Operating Activities. As a result of the foregoing factors, our results from operating activities was a loss of $3.0 million in the quarter ended September 30, 2012 from a profit of $0.9 million in the quarter ended September 30, 2011. Excluding the effects of our employee share-based compensation costs and merger and acquisitions related expenses for both quarters ended September 30, 2012 and 2011, we would have recorded an operating profit of $0.04 million in the quarter ended September 30, 2012 compared with an operating profit of $2.4 million in the quarter ended September 30, 2011.
Net Finance Income (costs). Our net finance income was $1.4 million in the quarter ended September 30, 2012 against a net
finance costs of $0.9 million in the quarter ended September 30, 2011, primarily due to higher forex gain and higher interest income earned on term deposits with banks in the quarter ended September 30, 2012.
Profit (Loss) for the Period. As a result of the foregoing factors, including the effects of employee share-based compensation costs and merger and acquisitions related expenses, our loss for the quarter ended September 30, 2012 was $1.2 million as compared to a profit of $0.07 million in the quarter ended September 30, 2011. Excluding the effects of employee share-based compensation costs, merger and acquisitions related expenses, net change in fair value of financial liability in business combination and income tax benefit for the second quarter of both fiscal years 2013 and 2012, net loss on change in the fair value of derivative financial instruments in the second quarter of fiscal 2013, we would have recorded a net profit of $1.2 million in the quarter ended September 30, 2012 and a net profit of $1.6 million in the quarter ended September 30, 2011.
Diluted Earnings (Loss) per share. Diluted loss per share was $0.03 for the quarter ended September 30, 2012 as compared to diluted earnings per share of $0.003 in the quarter ended September 30, 2011. After adjusting for employee share-based compensation costs, merger and acquisitions related expenses, net change in fair value of financial liability in business combination and income tax benefit for the second quarter of both fiscal years 2013 and 2012, net loss on change in the fair value of derivative financial instruments in the second quarter of fiscal 2013 as mentioned in the preceding paragraph, diluted earnings per share were $0.03 in the quarter ended September 30, 2012, compared to diluted earnings per share of $0.04 in the quarter ended September 30, 2011.
Fiscal Year 2012-13 Outlook
The Company is revising its fiscal year 2013 Revenue less service costs growth guidance in the range of 13% to 16% on a constant currency basis. This growth guidance is based on average actual Indian Rupee to U.S. Dollar exchange rate of 48.23 for full fiscal year 2012. On a U.S. dollar basis, we are updating our revenue less service cost guidance in the range of $89 million to $91 million solely to reflect the current 3Q13 average exchange rate of INR 54 to a U.S. Dollar. The previously provided guidance range had assumed an average exchange rate of INR 55 to a U.S. Dollar.
